The Australian home loan market witnessed significant growth in 2024, with 515,116 new home loans issued – an 11% increase from the previous year, accumulating $331 billion in mortgages, Money.com.au reported.
The final quarter of 2024 alone saw a rise of 3.3% in overall loan numbers year-on-year, with investor loans surging by 22% compared to just 6% for owner-occupier loans.
Investor loans grew more than three times faster than the owner-occupier segment, indicating a robust demand for investment properties.
“With vacancy rates across capital cities at record lows, rental demand showing no signs of easing and population growth, we’re likely to see the investor market pull even further ahead in 2025 as market conditions shift in a downwards rate cycle,” said Mansour Soltani (pictured above), a property expert at Money.com.au.
In 2024, Victoria topped the charts with the strongest annual growth in owner-occupier loans, rising by 10%. Queensland showed the highest quarterly growth.
“Property prices have stayed relatively steady in Victoria making it one of the best-value markets in the country right now,” Soltani said.
Queensland has solidified its position as Australia’s second-largest investor market, overtaking Victoria for the first time in annual investor loans recorded.
The Northern Territory saw the largest percentage increase in investor loans, jumping 40% year-on-year, Money.com.au data showed.
After a peak in 2023, refinancing saw a significant uptick in the last quarter of 2024.
Internal refinancing rose 15% compared to the same period in 2023, and external refinancing also saw recovery.
“This will fire up the refinancing landscape again after many borrowers were stuck in 'mortgage prison' due to high interest rates impacting their serviceability,” Soltani said.
First-home buyer loans increased by 6% in 2024. Despite a slight decline at year's end, prospects for 2025 are bright.
“We've had our first rate cut in nearly five years, and more are expected in 2025, which will boost borrowing power,” Soltani said. “Additionally, the ‘Bank of Mum and Dad’ is in a stronger position than ever to help with deposits or act as guarantors, as rising property prices have boosted their home equity.”
